Offer accepted, 60K for a beautiful turn of the century 6000 sq ft brick triplex!

[Mark Updegraff]

We're living through an incredible time! With a little experience it isn't too hard to lock in some amazing investment opportunities!

Here is my latest success story:

About a year ago I was trolling the Sheriff Sales and came across a beautiful brick triplex overlooking the city's most prominent park. Beautiful intact unpainted oak trim, tall ceilings, fireplaces, and a lot of rehab that was in the process by very competent contractors. Luckily someone left the back door open, and I spent a couple hours drooling all over the place. Doing the title search proved that the first (and only) lien holder was foreclosing, and the outstanding debt was around 180K.

My cramped calendar permitted me from attending the auction due a very hectic schedule! I often thought about who (if anyone) acquired it.

To my surprise there it was in my inbox a year later, on the MLS post foreclosure as REO. The listing price, $59,900!

I immediately made my offer (full price), and soon found out that there were 8 other offers and we were in a highest and best situation. I stood pat, relying on my lack of contingencies and experience and it worked! We'll be closing a 6000 sq ft beautiful brick triplex built in 1900! I'll put some more cash into rehab, but it will be my best cash flowing property when all is said and done.

One important thing to take away from this, is that foreclosure isn't always the cheapest way to buy property. I've seen it happen in multiple cities, in different states. At foreclosure the lender may bid quite high. When no one buys it and it goes REO, a broker will then list it for the bank and his opinion of value will weigh heavily on the listing price. I've personally seen a bank bid up to 80K and take a home, only to then sell it on the MLS post foreclosure for 20K!

Thanks to the BP community for all the enthusiasm and encouragement! I wish you all great success in 2012!!

Cheers,
Mark

[Mark Updegraff]

Thanks Jon!
Back of the envelope rehab is 40K at the upper end. 1st floor unit will be in the 1200-1400, second floor in the 1000-1200, upper unit 800-1200. I'm using 3000 total in my analysis, which I'm confident I can get based on my other units in the area. Due to a housing shortage, and a dramatic influx of people, that figure is conservative. I'm on vacation until tomorrow, but will post some pictures on this thread as soon as I return!